IPv4 is the original version of the Internet Protocol. It uses 32-bit addresses expressed in dotted decimal notation like 192.168.1.1. Addresses are divided into network and host parts based on the subnet mask. While IPv4 was widely adopted, it has limitations like a finite address space and no inherent support for mobility or security. Possible solutions include CIDR and NAT to extend the address space, but a new protocol, IPv6, was developed to overcome IPv4's limitations.